SHAFAQNA PAKISTAN | by Arsal Mir- Bilal Aslam deals in imports, exports and manufacturing and keeps a keen eye on the Pakistani and global economy.
He says that tensions in the Middle East are intensifying, Israel has announced that it will not stop missile attacks and Hezbollah has announced that it will enter into a regular war if there is no ceasefire.
The United States is supporting Israel financially and militarily, and the role of the United Nations in this whole situation is no more than that of a spectator.
On the one hand, this situation has threatened the peace of the world, on the other hand, there has been a fear of increasing global economic instability. Developed countries may cope with this crisis, but developing countries may not be able to bear the burden of this financial instability.
“If we talk about Pakistan, the instability in the Middle East can have a direct impact on Pakistan, which can affect my business like thousands of factories,” he said.
He said that the cost of doing business has already become too high, international organizations have said that the improvement in the Pakistani rupee is temporary, the value of the rupee is falling again against the dollar, interest rates are not decreasing.
According to Bilal, global inflation and rising dollar in Pakistan can prove to be a double-edged sword for my business. On the other hand, due to reduced purchasing power, consumers will not be able to pay the required price, under such circumstances it will not be possible for me to continue the business.
Former President of Sialkot Chamber of Commerce Mian Naeem Javed said that Pakistan’s exports are linked to America and Europe, the energy crisis in Europe has already increased and inflation has increased due to which Pakistan is not getting orders. .
According to the data of the first two months of the current fiscal year, there was an eight percent decrease in Pakistan’s exports, while in July and August, Pakistan was able to export only four and a half billion dollars, which is five percent during the same two months of last year. It was a billion dollars.
He said that if tensions increase in the Middle East, the situation in Europe will worsen and Pakistan’s exports may decrease further.
In the first two months of the current fiscal year, remittances were 4 billion 10 million dollars, which is 21% less.
He expressed fear that if the tension continues, the situation in developed countries will deteriorate and the remittances from overseas Pakistanis may decrease further.
He added that Iran being Pakistan’s neighbor and also a major source of trade through the land border, if Iran directly joins the conflict, the problems may increase for Pakistan.
What position Pakistan will take in these circumstances is important. The trade loss will also increase along with the threat to peace in Pakistan.
Former Finance Minister Dr. Hafeez Pasha said that Pakistan’s economy is most affected by oil prices, Pakistan’s biggest import bill is petroleum products….
He said that if the widening of the conflict causes a large-scale disruption in the movement of petroleum products, the price of oil is expected to increase by 55% to 70%, which is around $130 to $150 per barrel. can
According to this calculation, the prices of petroleum products in Pakistan may go up to Rs 550 per liter, the trade deficit may increase, the growth rate may decrease further and unemployment may increase.
He further said that the investment of Gulf countries in Pakistan is less likely to be affected by this tension, but there are many other factors that will make it difficult for Gulf countries to invest in Pakistan.
He said that the environment in Pakistan must be favorable for investment, it is not appropriate to link non-investment with Hamas-Israel tension.
Zafar Paracha, General Secretary of the Currency Exchange Association of Pakistan, said that so far Hamas’ involvement in Israel is limited and the oil producing countries are not being affected by it.
The value of the dollar in Pakistan is already high, according to Bloomberg it should be around 250. If more dollars are required to be paid for oil in the future (which is unlikely), the State Bank can manage it.
In the past, the State Bank had fixed a limit regarding the payment of dollars, which benefited. The real problem is rumours.
He claimed that taking advantage of the recent tension, banks are spreading rumors that the dollar will become more expensive, due to which the dollar rate in Pakistan is going up.
“The importer is being told to buy dollars while the exporters are being told to stop the dollars now. There is a need to take action on this matter.”
Source: Shafaqna Pakistan
Note: Shafaqna do not endorse the views expressed in the article